First Citizens Bank Serves as Lead Arranger on $250 Million Financing for Innovative Hybrid Thermal and Battery Energy Storage Projects in California

RALEIGH, N.C., Nov. 16, 2023 /PRNewswire/ -- First Citizens Bank announced today that its Energy Finance business acted as co-lead arranger on a $250 million financing on behalf of a portfolio of 327MW, 1hr duration battery storage projects developed in California by Middle River Power.

First Citizens Bank and MUFG acted as co-lead arrangers on the financing that includes a construction loan that will convert to a term loan, a tax equity bridge loan, and project LC facilities. Morgan Stanley Renewables Inc. has provided the tax equity commitment for the portfolio.

The portfolio of three battery storage projects will be paired with existing gas-fired peaking generation, creating first-of-its-kind hybrid facilities providing both low-emissions electricity and long-term reliability to Kings County and Fresno County, California.

Co-locating the natural gas peaking facilities with battery storage results in significant reductions in greenhouse gas emissions while maintaining reliable, flexible reserve capacity. The battery facilities will be able to store excess solar power during the day and release it when it is most needed over the evening hours. In addition, the natural gas-fired combustion turbines will dispatch significantly less often than they do today, resulting in lower emissions, while remaining available to dispatch during extreme conditions. 

"Middle River Power is building on its reputation as a provider of highly reliable power generation by developing high-quality energy facilities that serve the environmental and economic objectives of the regions where they do business," said Mike Lorusso, managing director and group head for First Citizens' Energy Finance unit. "We were pleased to work with them again in supporting financing for this innovative project which adds battery storage to existing gas generation."

"California has been a global leader in driving the clean energy transition, and this group of innovative projects is another important milestone towards providing the state with a reliable grid built on a foundation of clean energy. We're thrilled to leverage our strong financial relationships to bring these innovative projects to fruition, integrating additional renewable energy while enhancing a resilient grid. The energy storage assets store plentiful solar energy in the middle of the day then deploy that energy to the grid during evening peak hours, while maintaining natural gas facilities as a flexible, reliable backstop," said Mark Kubow, CEO of Middle River Power. "We are excited to introduce this first tranche of projects that takes such a meaningful step in helping California in the transition to more renewable resources.  We are excited to continue to work with our customers and partners to also bring the rest of the development pipeline to market in the coming years."

About First Citizens Bank
First Citizens Bank helps personal, business, commercial and wealth clients build financial strength that lasts. Headquartered in Raleigh, N.C., and now celebrating the 125th anniversary of its founding, First Citizens has built a unique legacy of strength, stability and long-term thinking that has spanned generations. First Citizens offers an array of general banking services including a network of more than 500 branches and offices in 30 states; commercial banking expertise delivering best-in-class lending, leasing and other financial services coast to coast; innovation banking serving businesses at every stage; and a nationwide direct bank. Parent company First Citizens BancShares, Inc. (NASDAQ: FCNCA) is a top 20 U.S. financial institution with more than $200 billion in assets. Discover more at firstcitizens.com.

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SOURCE First Citizens Bank